IYG Dividend Type Payments

iShares US Financial Services ETF dividend

Although IYG has no upcoming (meaning, Board-approved and announced) dividends, you can sell covered calls on iShares US Financial Services ETF to create 12 extra dividend type payments per year to boost its yield. Let's look at some recent prices (last updated Tue 4:16 PM ET):

iShares US Financial Services ETF (IYG)
Bid Ask Last Change Volume P/E Market Cap
115.06 119.43 117.25 -1.08 171K - 0.0B

IYG Dividend-Like Income Using Covered Calls

With IYG at 117.25, here's a table showing how big the annual "dividend" (ie. total annual call premium received) would need to be to attain 3%, 5%, and 10% annual yields. Also shown is the equivalent number of cents/day necessary to achieve each yield:

Annual Yield Annual Premium Cents/Day
3% 3.52 1.0
5% 5.86 1.6
10% 11.73 3.2

So now we need to find out of the money covered calls that pay at least the prescribed cents/day amount of time premium. That will generate income and, because they are out of the money, leave room for some upside potential on the stock. Here are some examples:

3% Yield On IYG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 123.00 0.15 11 1.4 3.57 (3.0%)
Jan 18 126.00 0.45 39 1.2 6.57 (5.6%)
5% Yield On IYG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 121.00 0.50 11 4.5 1.57 (1.3%)
Jan 18 125.00 0.70 39 1.8 5.57 (4.8%)
10% Yield On IYG Using Covered Calls
Expiration Strike Call Bid Days Cents/Day Upside Potential
Dec 21 121.00 0.50 11 4.5 1.57 (1.3%)
Jan 18 120.00 2.15 39 5.5 0.57 (0.5%)

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Top 10 Open Interest For Dec 21 Expiration     Top 5 High Yield
1.DUST dividend 6.NSSC dividend   1. dividend
2.NOVT dividend 7.MOD dividend   2. dividend
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4.VSI dividend 9.EC dividend   4. dividend
5.DXJS dividend 10.NTWK dividend   5. dividend

Want more examples? IYF Dividend | IYH Dividend